So, Alex Wilmot-Sitwell didn’t want to move to Dublin. So says Financial News today in a piece scrutinizing the former BAML executive’s reasons for quitting last month. That could have been a mistake: last week’s report from the European Banking Authority (EBA) on high earners in Europe suggests working as a banker in Dublin has its advantages.
As the chart below shows, high earning bankers (defined as investment bank employees earning over €1m) earned an average of €1.7m in Ireland in 2016 (the year for which figures have been newly released). This was 6% more than high earning bankers earned in Germany and 13% more than they earned in France.
Nor is this Ireland’s only advantage. As the next chart shows, high earners in Irish investment banks also receive the highest proportion of their pay as a bonus, and they get the lowest proportion of their bonuses deferred. In London, 66% of high earners’ bonuses were deferred in 2016. In Dublin, just 31% were.
Would this have been enough to persuade Wilmot-Sitwell to relocate to Ireland? Probably not. As the final chart below (also from the EBA) shows, almost all the high earning bankers in Europe in 2016 were located in the UK. This could clearly change as banks migrate staff out of London, but it helps explain the resistance of bankers like Wilmot-Sitwell and others to moving to Europe. – The high paying jobs, and the ‘lifestyle infrastructure’ that accompanies them, have historically all been based in London. As one Deutsche Bank insider is said to have noted, “Senior bankers who have been working in London for a long time, send the children to expensive private schools and just can’t be bothered to move.” With the UK having over 3,000 people earning more than €1m in banking in 2016 to Ireland’s 33 and Germany’s 253, it’s clearly going to be a long while before rival European financial centres can catch up.
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